Where should new angel investors focus? A look at the most promising sectors

by Xavier Ballester, Director of Brokerage, Angel Investment Network

When I think about where new angel investors might want to put their money, I always look at the current landscape and what’s genuinely exciting and impactful. Based on recent conversations and interesting survey data across our network, a few sectors really stand out.

Investing in innovation: Why Healthtech and AI are booming

For me, HealthTech is one of the most profitable opportunities for investors. It’s captured the interest of over half the investors in our network in our survey, and for good reason. Since the pandemic, we’ve seen consistent strength, especially in preventative health. With ageing populations and everyone being impacted by health it is by definition scalable.

Any technology that can ease that burden and deliver significant cost savings for both the system and taxpayers is incredibly valuable. I’m talking about businesses that leverage data to predict illnesses before they become serious, or those developing innovative wearables that can monitor our health in real-time. The potential for these companies to scale and positively impact so many lives is enormous. It’s about empowering people to take control of their health and, in turn, creating a healthier society.

Right on its heels in terms of the data from our survey is AI. Now, it’s crucial to understand that AI isn’t a standalone industry; it’s a powerful force that’s transforming nearly every sector. What truly piques my interest, and that of the investors I speak with, isn’t just a company slapping “AI” on their marketing materials.

Instead, we’re looking for businesses that are genuinely using AI to create meaningful change. This means empowering companies, big or small, to either significantly improve their current operations or open up entirely new business avenues. Think about streamlining existing systems by removing bottlenecks, or leveraging real-time data to uncover fresh, actionable insights for clients, ultimately identifying new revenue streams.

Within the AI space, one area of real innovation we’ve noted where startups are innovating is with edge computing. With the ever-increasing demand for computational power, the cost of data for AI can be substantial, especially the further you are from a data center. Edge computing offers a solution by processing data closer to its source, leading to greater efficiency – and that’s exactly what major players like Nvidia are looking for.

The enduring and the evolving: Sustainability, FinTech, and ClimateTech

Even with the shifting political tides, Sustainability remains a strong focus for our investors, which I find incredibly encouraging with innovative startups offering some of the best routes to tackling worldwide challenges like climate change. It highlights a continuing investor interest in both impact and financial returns, demonstrating that these two goals aren’t mutually exclusive.

Then there’s FinTech. It’s still a robust sector, but for me, the key is to look for genuine innovation beyond the initial wave of disruption we saw. I’m seeing a fascinating trend towards startups that are creating investment products offering a holistic view of all your money in one place. Imagine being able to see all your finances cohesively, allowing families and individuals to plan their financial future with much more clarity. The future of consumer-focused FinTech, in my opinion, lies in moving beyond simple transactional services to genuinely supporting consumers’ lifestyles.

Within FinTech, Insurtech startups are definitely gaining traction. Many new products are disrupting the sector by offering much more personalized solutions. For example, I recently encountered a client who is using data to provide tailored health insurance for individuals with diabetes – a huge market that was previously very difficult to serve effectively.

Finally, ClimateTech also remains a significant area of interest. Like Sustainability, it underscores the growing understanding that addressing climate change presents enormous opportunities for innovation and profitable ventures.

For new investors, check out the AIN platform where there are a host of exciting startups from these sectors alongside many others with innovative solutions to real world problems. You can connect via the platform, or feel free to reach out to me or the brokerage team to be added to our tailored mail out of some of the most exciting startups.

Are you looking for an angel investor to help fund your business? Join us at Angel Investment Network, where global investors meet the great businesses of tomorrow.